On March 11, 2021, the American Rescue Plan Act of 2021 provided that employers may once again voluntarily extend Emergency Paid Sick Leave (EPSL) and Emergency Family and Medical Leave Expansion Act (EFMLEA) provisions of the Families First Coronavirus Response Act (FFCRA) to employees and receive those tax credits.
This time the extension runs through Sept. 30, 2021, and further modifies the benefits that employees may receive if employers decide to voluntarily extend the benefits effective April 1, 2021. Stated plainly, while the new law does not mandate that covered employers continue to provide EPSL and EFMLEA to employees as the FFCRA provided in 2020, it does broaden the qualifying reasons for the tax credit and provides a new bank of EPSL.
How much leave may employers provide?
Under the rescue plan act, covered employers may voluntarily continue to provide EPSL; however, to be eligible for the applicable tax credit, an employer must provide a new bank of EPSL of up to 10 days for employees’ use beginning on April 1, 2021 and ending on Sept. 30, 2021. Further, employers may voluntarily continue to provide employees with any remaining EPSL they would have been entitled to under the FFCRA and the Consolidated Appropriations Act of 2021.
For example, if a full-time employee had used eight of the original 10 days available to them through March 31, then as of April 1, the employer may voluntarily provide them with 12 days (two remaining days, plus the 10 new days).
The new law does not create a new bank of EFMLEA, which remains capped at 12 weeks. However, it does provide that the first two weeks of EFMLEA can be paid and employers may seek the corresponding tax credit for those two weeks (previously, the first two weeks were unpaid, but an employee could use available EPSL for those weeks), and it increases the maximum amount of FFCRA tax credits for EFMLEA from $10,000 to $12,000 in the aggregate per employee.
Employers may elect to extend just EPSL benefits, just EFMLEA benefits, or both.
Qualifying reasons for leave
The FFCRA’s original six qualifying reasons included the following:
- The employee is subject to a federal, state, or local quarantine or isolation order related to COVID-19;
- The employee is subject to the advice of a health care provider to self-quarantine related to COVID-19;
- The employee is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
- The employee is caring for an individual subject to an order described in (i) or in self-quarantine as described in (ii);
- The employee is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19; or
- The employee is experiencing any other substantially similar condition identified by the Secretary of Health and Human Services.
The American Rescue Plan Act adds additional qualifying reasons as follows:
- The employee is obtaining a COVID-19 vaccination;
- The employee is recovering from an injury, disability, illness or condition related to a COVID-19 vaccination; or
- The employee is seeking or awaiting the results of a COVID-19 test or diagnosis because either the employee has been exposed to COVID-19 or the employer requested the test or diagnosis.
Under the new law, employees may use either EPSL or EFMLEA for any of the original or new qualifying reasons.
Considerations for employers
Employers should first decide whether they will continue to provide just EPSL, just EFMLEA, or both sets of benefits through Sept. 30, 2021. Employers choosing not to continue providing one or both sets of benefits should remove reference to the benefits from any policies and handbook and take down the FFCRA poster.
Employers who voluntarily extend ESPL and/or EFMLEA benefits as of April 1, 2021, should communicate that decision to employees along with the new Sept. 30, 2021 end date. Employers should continue to assess whether “regular” FMLA leave runs concurrently with any EPSL or EFMLEA leave taken by an employee. In such cases, employers who are covered under the federal FMLA (those with 50 or more employees) must follow the normal processes governing administration of FMLA leave.
The new law, like the Consolidated Appropriations Act of 2021, only expands the tax credit provision for employers; therefore, it does not appear to permit employers to count EFMLEA against an employee’s “regular” FMLA entitlement, as was the case with the now expired FFCRA.
Donna M. Glover is a shareholder in the Baltimore office of Baker Donelson and a member of the firm’s labor & employment group. She can be reached at firstname.lastname@example.org.